A perceived bias towards Dominion Finance director Robert Barry Whale has caused High Court Justice Pamela Andrews to step down from hearing the trial of the defendant and two others accused of theft.

In her published decision just released Justice Andrews said she was a partner and consultant for law firm Kensington Swan before she became a judge, but only yesterday did she discover that Whale had also been a partner between 1996 and 2001.

The judge raised the issue with lawyers involved in the case and while Whale’s counsel Paul Davison QC and the Crown prosecutor did not object to Andrews continuing with the case, lawyers for both the second defendant Paul Cropp and another defendant, who cannot be named, applied for the judge to recuse herself.

Justice Andrews said she had no recollection of Whale being a partner of the law firm and did not recall having had any personal dealings with him.

She said that none of the lawyers had previously brought the matter up with her, however the judge revealed that a potential issue had been raised over another link to one of the witnesses due to testify in the case.

Lawyers on both sides agreed before the trial that Justice Andrews’ past link to the witness would not pose a conflict of interest.

"‘Notwithstanding that the legal partnership with Mr Whale ceased in 2001, any legal partnership requires, as between the partners, trust and good faith," said Justice Andrews.

"‘For that reason I have concluded that I must not continue to try this case.

"A fair-minded lay observer might well have concerns as to whether a judge could bring an impartial mind to resolving issues of credibility in respect of a former legal partner of the judge.

"I have no doubt that, had I recalled the partnership when I was assigned to this trial, I would have declined to try the case for the reasons I have set out above.

"I am satisfied that my approach should not differ, now that the trial has begun."

A new trial has been set in the High Court at Auckland for next Monday to be heard by Justice Graham Lang, who was confident he had no conflicts.

Former Dominion Finance director Robert Barry Whale faces five Crimes Act charges, former chief executive Paul William Cropp faces four charges, and another person who has name suppression faces two charges in the trial which began on Monday.

Dominion Finance collapsed into receivership on September 9, 2008, owing more than 5900 public debenture investors $176.9 million, and a further $56m to ASB and Bank of Scotland International.